The success of good planning is limited by an organization's span of control. Planning is not only possible where people are working together, it is necessary. Planning allows organizations to duplicate their internal processes and grow them. Planning allows different organizations and people to work together efficiently. The entire point of strategy and competition is to gain the control that makes planning possible.

However, classical front-line strategy is not planning. Planning follows a series of steps to produce a well-defined result. Such planning requires control or at least agreement over the elements and events that create that result or product. It requires that people work together. Planning must make the key resources—machines, raw materials—readily available when needed. This is only possible within a controlled environment—such as a factory, an office, or a supply chain—where everyone agrees what must be done.

When people share goals and a decision-making hierarchy, we call them "inside the organization." Different organizations can also share goals and processes, despite their separate hierarchies, as business partners and parts of a supply chain. Both organizations and supply chains have social or legal contracts that define individual responsibilities and authority. These agreements create the controlled environment necessary for planning, but those agreements themselves are not the result of plans but of front-line strategy.

Planning in controlled environments is not only useful but necessary. In controlled environments, plans are shared to eliminate conflict. The series of planned steps results in a predictable outcome. Control means that production meets prediction as planned. The more planning is shared, the more efficiently resources are used and the more predictable the results of operations. Everyone feels great when a plan comes together.

Planning is so predictable that it would be nice to think that everything can be planned, but the fact is that, even in a perfect world, very little that happens can be planned. Read on...